Friday, September 13, 2013

Monster beverages, monster puffery

Plaintiffs brought the usual California claims, including
warranty claims, over Monster’s energy drinks’ allegedly excessive and
unwarned-for caffeine.Until recently,
Monster called the drinks “dietary supplements” instead of beverages, allegedly
to avoid disclosing their caffeine content, but changed the classification in
early 2013.Individual plaintiffs
alleged that they believed that Monster beverages were safe and therefore
bought them, sometimes starting when they were under 18 due to Monster’s
marketing/free sampling targeting young people; one alleged that he drank so
much—often with alcohol—that he developed serious health issues, including
critically high blood pressure and withdrawal headaches when he tried to
stop.(Yeah, I get those.)Other alleged health risks from excessive
consumption include dehydration and high-risk behavior.

Plaintiffs alleged that Monster targeted young people,
including by sponsoring extreme sports and by “obfuscat[ing]” the risks of the
product as well as by enticing them with labels such as “It’s the ideal combo
... to deliver the big bad buzz that only Monster can” and “Athletes,
musicians, anarchists, students, road warriors, metal heads, nihilists, geeks,
hipsters, bikers, and milfs dig it. You will too.” Monster allegedly promoted
mixing Monster drinks with alcohol, and energy drink consumption is a risk
factor for alcohol dependence.

Monster allegedly contains very high levels of caffeine,
including stimulants like guarana, which contains “hidden” additional caffeine.
Though Monster doesn’t label each can’s content, it has disclosed elsewhere
that a 16-ounce can has 160 mg of caffeine, while the FDA considers 400 mg safe
for healthy adults daily, and the American Academy of Pediatrics recommends
only 100 mg for adolescents.The can
states: “Consume responsibly--Max 1 can per four hours, with limit 3 cans per
day. Not recommended for children, people sensitive to caffeine, pregnant women
or women who are nursing.”

Monster argued that the plaintiffs didn’t have standing because
they didn’t allege physical injury, only that Monster drinks could be bad for
their health.Plaintiffs argued that
they alleged economic injury—they overpaid/wouldn’t have bought the product if
they’d known the truth.The court found
two plaintiffs’ allegations insufficient to demonstrate economic injury,
because they didn’t allege misrepresentation or deception, only that they “saw
nothing on the labeling of the [cans of Monster Drinks] that would lead [them]
to believe that drinking [the Monster Drinks] could be bad for [their]
health....”This was a purely
hypothetical injury.They also didn’t
allege that they paid a premium because of any misrepresentation (since they
didn’t allege a misrepresentation) or that they would’ve bought something else
absent a misrepresentation.

Although plaintiffs argued that their claims weren’t
grounded in fraud, the court concluded that they were and that they flunked
Rule 9(b). Plaintiffs brought claims
against 28 varieties but only alleged purchase of 8 specifically, then
generally alleged that they consumed others.They also didn’t allege which ads or labels specifically misled them.

Monster also largely succeeded in its preemption arguments,
despite overrelying on POM Wonderful LLC
v. Coca–Cola Co., 679 F.3d 1170 (9th Cir. 2010), which didn’t consider state
law claims that imposed requirements “identical to” FDA requirements.However, Monster argued that plaintiffs were
seeking to impose caffeine labeling requirements not identical to the FDCA/FDA
requirements.Insofar as the consumer
protection claims were based on failure to adequately label the ingredients,
the claims were dismissed, since Monster disclosed the total quantity of
ingredients in its “proprietary blend” as required.Also, the FDA doesn’t require the caffeine
warnings sought by plaintiffs, so claims based on their absence were preempted.

The court also rejected plaintiffs’ breach of warranty
claims.Monster’s statements were
nonactionable puffery, not warranties:

• “It’s the ideal combo ... to deliver the big bad buzz that
only Monster can.”

• “[B]igger is better ... because you can never get too much
of a good thing.”

• “We hacked our carbohydrates and calories, transplanted
the wicked buzz and dialed in the flavor. Lo–Carb MONSTER energy still delivers
twice the Buzz of a regular Energy drink, but only has a fraction of the
calories.”

• “You’re gonna love it cause it’s a new kind [of] buzz.”

• “No regular bottle could handle this evil energy brewski.
So we designed our own with the biggest chugger friendly wide mouth we could
make.”

• “A shot it’s not ... but then you don’t have to plug your
nose to drink it!”

• “Monster Extra Strength packs our biggest punch!”

• “[B]uzz that’s bigger than ever. This is no “Whip-it” but
it will whip you good.”

• “Our friends at the Rehab pool party in Vegas know all about
recovering from a long night and together we came up with Monster Rehab Green
TeaEnergy.”

• “[Q]uenches thirst, hydrates like a sports drink, and
brings you back after a hard day’s night.”

• “[O]ur bad Rehab energy blend to fire you up.”

• “It’s a wicked mega hit that delivers twice the buzz of a
regular energy drink.”

Nor did plaintiffs successfully allege that Monster breached
an implied warranty of fitness for intended use.They alleged that the drinks “can cause
serious and even fatal health problems, ... and excessive consumption may
result in increasing heart rate, blood pressure, other cardiovascular
complications, sleep deprivation and diarrhea, among others.” But they limited their allegations to the
claim that the drinks didn’t conform to the promises on the label, and such
claims were preempted.These failures
got rid of the Magnusson-Moss claim as well.

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